How the link between credit and economic growth has broken: Joseph Mason column

joseph-mason-gray
Joseph Mason: fiscal drag dangers

As I write this, Standard & Poor's has downgraded the US's debt rating and other countries' ratings may follow. Markets are facing meltdown. We may all know that the events are related to what the world has been through since 2007, but few understand the linkages involved.

In 2008–09, already over-extended sovereigns bailed out their banking sectors to avoid losses. The reasons are simple: banks are thought to intermediate high-asymmetric information assets – particularly small business loans –

To continue reading...

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: